Monday February 25, 2013
Chapter 1-6 and appendix 314 – 329 from textbook, plus class handout and Harvard
busienss review article “how leaders create and use networks” January 2007, and
o M/C – 15 q @ 2 pts each 30%
o T/F – 15 @ 1 pt each 15%
o S/A – 5 q @5 pts each some with choice) 25%
3 q @10 pts each (some with choice) 30%
Chapter 6 – Person-Based Structures
Skill based structure
links pay to the depth or breadth of the skills, abilities, and knowledge a person
differences between skill based and job based pay systems?
Compensation us based on the skill or skill units an employee is capable of
performing rather than jobs
Mastery of skill units is determined through measurement and the certified
Individuals are paid for all the skills for which they have been certified, regardless of
whether the work they are doing requires all or just a few of those particular skills
(i.e. pay changes do not necessarily accompany work reassignment)
There is little emphasis on seniority when determining pay
Skill based terminology
Skill path (category)
o Grouping of related skill blocks of varying skill levels that represent all
activities of a single job family or steps in a process; for example: balzer –
ADMIN, SALES, TOOLS etc
o Grouping of skills, activities, or behaviours; for example: Balzer
o Types – BASIC = 4 skill blocks
o Smallest unit of analysis a specific statement of what a person does;
soldering a circuit board
Types of skill based pay plans
Specialist: in depth
o Surgeon, French teacher
o Pay is based on the range of knowledge specific to a group of related job
(administer, manager) Purpose of the skill based structure
Support the strategy and objectives
Support work flow
Fair to employees
Motivate behaviour toward organizational objectives
“How to”: Skill Analysis??????????
Determining the internal skill-based structure
o What is the objective of the plan?
o What information should be collected?
o What methods should be used to determine and certify skills?
o Who should be involved?
o How useful are the results for pay purposes?
Why use a skill based system? Could there be any disadvantages?
Potential effects of a skill-based system
Lower staffing levels
Improved relations with labour
Average pay of employees likely higher
High labour costs if productivity increases do not offset additional
More complex system
Requires a major investment in training
Person based plans
Competency based pay structure
Underlying, broadly applicable knowledge, skills and behaviours
that for the foundation for successful work performance
Independent of a job or position
Can be transported from one job to another
Contrast of trait/behaviour based competencies
Trait based Self starter:
o Likes to take initiative
o Motivate to get exceptional results